Vintage Capital to Nominate Five Candidates to Aaron's Board

Investment firm Vintage Capital Management LLC said it plans to nominate five candidates for
Aaron
AAN 0.03%
's Inc.'s board, an effort to gain a majority of the rent-to-own retailer's board during its buyout effort.

Aaron's last month received a roughly $2.3 billion unsolicited bid for the company from Vintage. The investor has a 9.5% stake in Aaron's, making it the company's second-largest shareholder, according to FactSet.

Aaron's said it will review the nominations, along with a slate of four candidates from Starboard Value LP, and will present its recommendations to shareholders.

A representative from Starboard wasn't immediately available for comment.

Aaron's has nine regular board members.

The company separately said Friday that a special committee has started a broad review of potential options for the retailer, adding to a continuing evaluation of Vintage's bid.

Vintage complained of "poor recent financial results" at the company and "continued decline of store traffic."

"It has become clear to us that immediate and decisive action is needed to stabilize Aaron's and preserve shareholder value," Mr. Kahn said.

He directly called out Aaron's Chairman and Chief Executive
Ronald Allen
for "failing shareholders by pursuing ill-advised strategies that have soured relationships with Aaron's customers, franchisees and employees."

In late February, Aaron's created the special committee of independent directors to review the Vintage offer with the help of advisers. The board since retained
Goldman Sachs Group Inc.
as an additional financial adviser, along with
Blackstone Group L.P.

Aaron's, which rents and sells furniture, electronics and appliances, has struggled during what it has called a difficult economic environment for its low- to middle-income customers. The company recently warned that it would slow new-store growth at both its Aaron's and HomeSmart locations until business conditions improve.

Vintage had said it privately offered to acquire Aaron's three times since 2011, according to a recent letter to the board. Each time it said it was "summarily ignored."

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